ZM reported Q2 earnings on August 25 and the immediate reaction was negative — the stock dropped 3.7% on the day to $100.92, giving back some of its strong 15% monthly gain heading into the print.
The options market had positioned cautiously ahead of the release, and that hedging proved warranted. Going into earnings, the put/call ratio was running just above its 20-day average at 0.50, with a z-score barely above zero — essentially neutral relative to recent history, and a far cry from the defensive spike flagged in the pre-earnings note. Post-print, the ratio eased slightly to 0.50, suggesting options traders are not adding meaningful new downside cover. Borrow conditions remain entirely benign: availability is extraordinarily loose at over 8,000% of short interest, meaning there are roughly eighty shares available to borrow for every one already lent out. Cost to borrow is near its lowest level of the past month at 0.34%. Short interest at 2.7% of the free float is low and barely moved on the week — up a fraction of a percent — after trending down around 6% over the prior month. There is no short-side pressure building here.
The Street's post-earnings response tells a story of calibrated but intact confidence. Morgan Stanley's Meta Marshall maintained her Equal-Weight rating while nudging the target a modest $2 higher to $107 — essentially saying the print didn't change the cautious thesis but didn't break it either. Jefferies trimmed its target by $2 to $116 while keeping a Buy. At the constructive end, RBC Capital, Rosenblatt, BTIG, and Needham all reiterated Buy or Outperform calls with targets ranging from $125 to $130. The consensus sits at Buy with a mean target of $117.80 — about 17% above the current price. The split is familiar: bulls point to AI Companion differentiation, Zoom Phone and Contact Center growth, and the recent Common Room acquisition as evidence the platform is evolving beyond video. Bears flag persistent macro pressure on IT budgets, Microsoft Teams competition, and the risk that seat-based expansion continues to stall. EV/EBITDA near 10x and a P/E of 17x are not stretched, but with forward EPS momentum ranking in the bottom quartile of the universe — 25th percentile on 90-day earnings momentum — the valuation requires execution to justify even modest multiple expansion.
One institutional data point worth noting: Norges Bank Investment Management added over 2 million shares in the quarter to June, making it the most active builder among the major holders. Eric Yuan remains the largest individual holder at just over 7% of shares, though he sold roughly $2 million worth in early August across several small tranches — low-significance trades consistent with a plan-based programme rather than a directional signal. The insider data carries a low trade-significance score of 2 out of 10.
Among close peers, the week was broadly weaker for software names. FIVN fell half a percent, RNG added less than 1%, and EGHT dropped nearly 5%. MNDY and ASAN bucked the trend, gaining around 6% and 3% respectively — both of those are further from their earnings windows. ZM's 3.6% weekly decline sits roughly in the middle of the peer range, consistent with a post-earnings digest rather than a stock-specific re-rating.
The next scheduled print is November 23. Between now and then, the focus shifts to whether Zoom Phone and Contact Center show enough traction to justify the Street's more optimistic targets in the $125–$130 range — or whether the macro headwinds flagged in the bear case start to show up in enterprise renewal data.
See the live data behind this article on ORTEX.
Open ZM on ORTEX →ORTEX Market Intelligence content is generated by AI from a snapshot of ORTEX's proprietary data. Content is informational only and does not constitute investment advice.
